CHICAGO (CBS/AP/CNN Money) — The owner of Jewel-Osco and several other grocery store chains has agreed to a deal to buy the nation’s third-largest drugstore chain, Rite Aid.

The deal will create a new company with about $83 billion in annual sales, and 4,900 stores nationwide.

Albertsons Companies is offering either a share of its stock and $1.83 in cash or slightly more than a share for every 10 shares of Rite Aid. Shares of Rite Aid, which have shed more than half their value over the past year, surged 26 cents, or 12.2 percent, in premarket trading after the deal was announced.

Shareholders of Boise, Idaho-based Albertsons will own more than 70 percent of the combined company, which is expected to trade on the New York Stock Exchange. The companies say the deal should close in the second half of this year, but regulators and Rite Aid shareholders still have to approve it.

Rite Aid Chairman and CEO John Standley will lead the combined company as CEO, while Albertsons leader Bob Miller will serve as chairman. The companies say they will keep headquarters in both Boise and Camp Hill, Pennsylvania, which is where Rite Aid is based.

Albertsons said it will continue to run Rite Aid stand-alone stores, and most of the grocery operator’s pharmacies will be rebranded as Rite Aid. Albertsons also runs Jewel-Osco, Safeway, Vons, Shaw’s and Acme stores.

Walgreens wanted to buy up all of Rite Aid in 2015, but federal regulators nixed that agreement on antitrust grounds. Instead, September, the two companies announced a scaled back version for nearly 2,000 of Rite Aid’s stores. That left Rite Aid with around 2,600 stores. Walgreens agreed to buy nearly 2,000 Rite Aid locations and some distribution centers for about $4.38 billion. Rite Aid said late last month that it had transferred about 625 stores to Walgreens.

(© Copyright 2018 CBS Broadcasting Inc. All Rights Reserved. The Associated Press and Cable News Network contributed to this report.)

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